The end of the Berlusconi era for Italy

Italy, Rome: Italy's Justice Minister and new general secretary of the ruling party Partita della Liberta Angelino Alfano is greeted by Italian Prime Minister Silvio Berlusconi during a meeting of the PDL on July 1, 2011 (AFP Photo / Alberto Pizzoli) / AFP

Berlusconi has named as his likely successor a former justice minister, Angelino Alfano, who gained notoriety for going above and beyond the call of duty in his efforts to keep the Italian Prime Minister immune from prosecution.

Prime Minister Silvio Berlusconi declared on Tuesday he is throwing in the towel after a scandal-ridden decade in power. His promised resignation comes with a precondition that parliament pass a series of budget cuts to keep its sinking economy afloat.

Angelino Alfano served as Italy’s Minister of Justice from 2008 to 2011 in Berlusconi’s cabinet. He took on the role at the age of 38, which made him the youngest Minister of Justice in the history of the Italian Republic. In July 2011 he became the Secretary of the center-right party, People of Freedom.

In 2008, Alfano introduced the so-called «Alfano Law» (Lodo Alfano) that granted immunity from prosecution to the four highest political offices in Italy: the President of the Republic, the two Speakers of the Houses of Parliament and the Prime Minister. The law was in place for two years until it was declared unconstitutional by the Italian Constitutional Court.

He was also rumored to have connections to the Mafia boss Croce Napoli, as revealed by an amateur video made at the wedding of Napoli's daughter in 1996. When confronted by the press in 2002, Alfano first denied ever being at the wedding. However he was later forced to confirm that he had indeed been present, but insisted he was invited by the groom and never knew the bride and her mafioso family.

Controversy notwithstanding, Angelino Alfano is currently the man most talked-about as a possible future head of whatever new government emerges.

The Italian President, Giorgio Napolitano, is expected to make an announcement soon about a new government. Whether it will be an interim administration remains to be seen. However, it is thought that Italian officials are going to try to steer away from the elections, a decision which is going to cause even more uncertainty at what is already an unstable time.

However on Wednesday, Italy saw its borrowing costs soar into the danger zone, passing seven per cent. The key figure has raised anxieties because it was the trigger point at which Ireland, Greece and Portugal were forced to seek bailout assistance from the eurozone and the IMF. It is also a point at which investors looking at the country’s huge debt are expected to just stop lending. That would be absolutely disastrous for Italy which has a mammoth 1.8 trillion euro debt.

Earlier this week, European stock markets dropped sharply after Italian Premier Silvio Berlusconi confirmed he will step down. The Italian stock market tumbled 3.7% with European stocks following the trend.